Hotel operators were awaiting details on Thursday of a government wage-subsidy scheme, with the industry looking to the labour ministry for a plan due to be announced on April 2 as Cyprus tries to shield tourism from the fallout of the Middle East war.

The latest round of contacts came as government officials, hotel representatives and unions stepped up consultations over the past 24 hours in a bid to shape a proposal acceptable to all sides.

Trade unions, which met Labour Minister Yiannis Panayiotou in the presence of director of labour relations Andis Apostolou and the ministry’s director general Stelios Chimonas, said any final scheme must be built around the full protection of workers’ rights, the safeguarding of earnings and the continuation of employment.

They also insisted on the equal treatment of all workers, warning against practices that could lead to the substitution or exclusion of Cypriot and other EU nationals through the hiring of third-country workers.

According to information published by philenews, unions argued that the ministry must define criteria that guarantee equal access to employment and avoid distortions in a sector where working arrangements often differ from one employee to another.

That leaves the ministry with the challenge of designing a formula that supports both employers and staff without creating inequalities or a two-speed workforce across the hotel industry.

Michalis Frangou, general secretary of the association of hotel employees and leisure centres, said the criteria to be announced should ensure the full and substantive protection of employees, with absolute respect for their rights, while also preserving incomes and jobs.

Neophytos Timinis, general secretary of the hotel and leisure centre employees’ union, said a key condition for subsidising hotel operators should be the return of all employees to hotels whose operations had been suspended in October for the winter season, while dismissals should be ruled out.

At the same time, hotel associations Pasyxe and Stek were reported to have sought an increase in the wage subsidy proposed by President Nikos Christodoulides, from 30 per cent to closer to 50 per cent.

Under the president’s original proposal, the subsidy would apply to hotel units and tourist accommodation operating throughout the period from April 1 to April 30, 2026.

Government spokesman Konstantinos Letymbiotis said the state’s aim, together with the relevant bodies, was to secure another successful tourist season despite the disruption caused by the regional conflict.

He said the situation was being assessed almost daily by both the government and hoteliers, adding that the authorities were encouraged by signs of improvement as flight schedules and daily life in Cyprus were returning to normal.

Letymbiotis also said almost all airlines were moving back towards full operations, while nine new flights had been announced by new carriers to and from Cyprus.

The government has also sought to reassure overseas partners. Deputy Tourism Minister Kostas Koumis, in a video conference with members of ECTAA, European travel agents and tour operators’ associations, told European travel agents and tour operators that Cyprus is a safe destination, ready to welcome millions of visitors as it does every year.

Industry figures said the season was still under pressure. Hotel association Pasyxe struck a somewhat more upbeat tone over prospects for May, with its president Thanos Michaelides saying cancellations were easing and bookings were beginning to recover.

Still, he said reservations in March and April were down 42 per cent, while Easter occupancy remained well below levels recorded in the corresponding periods of previous years.

Travel agents, however, were more cautious. The association of Cyprus travel and tourism agents, Actta, president Haris Papacharalambous said the main problem facing Cyprus after the outbreak of war in the Middle East was the image of insecurity created abroad, made worse by travel advisories issued by various countries.

He warned that the season was likely to remain difficult and said airline schedules were expected to keep shifting despite efforts to steady the market.

Meanwhile, Disy called for targeted support measures for vulnerable groups and tourism businesses, saying constant monitoring, timely analysis and focused state intervention were needed to prevent short-term pressures from turning into more serious and lasting problems.